What are the different types of annuities?
- What is an annuity?
- What are the different types of annuities?
- Are there tax benefits to annuities?
- What are the advantages of annuities?
- What are the disadvantages?
- Do all annuities have high fees?
- What investment options do annuities have?
- What payout options do I have?
- What if I decide to withdraw the money?
- How do I know if buying an annuity is right for me?
- Should I hold an annuity within my IRA?
- What happens to my annuity after I die?
- How do I know the company will honor my future payments?
- Should I exchange my existing annuity for a new one?
- What if I bought an annuity I no longer want?
There are two basic types of annuities: deferred and immediate.
With a deferred annuity, your money is invested for a period of time until you are ready to begin taking withdrawals, typically in retirement.
If you opt for an immediate annuity you begin to receive payments soon after you make your initial investment. For example, you might consider purchasing an immediate annuity as you approach retirement age.
The deferred annuity accumulates money while the immediate annuity pays out. Deferred annuities can also be converted into immediate annuities when the owner wants to start collecting payments.
Within these two categories, annuities can also be either fixed or variable depending on whether the payout is a fixed sum, tied to the performance of the overall market or group of investments, or a combination of the two.
